WhatsApp founder Jan Koum announced on Monday that the company is dropping the services’s annual subscription fee and going completely free. WhatsApp previously had a yearly subscription fee of €0.99 per year after the first year of use.
Koum said that, “It really doesn’t work that well, we just don’t want people to think at some point their communication to the world will be cut off.”
WhatsApp will stop charging fees immediately however it will be a number of weeks before the payments infrastructure is completely out of all versions of the app. There will be no refunds given if you have already paid your 99 cents for the year.
WhatsApp is now exploring new ways that businesses can use the service to connect with individuals but still avoid spam and unwanted advertisements. It is a fine balance to try and reach however WhatsApp said the following in a blog post:
Naturally, people might wonder how we plan to keep WhatsApp running without subscription fees and if today’s announcement means we’re introducing third-party ads. The answer is no. Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organizations that you want to hear from. That could mean communicating with your bank about whether a recent transaction was fraudulent, or with an airline about a delayed flight. We all get these messages elsewhere today – through text messages and phone calls – so we want to test new tools to make this easier to do on WhatsApp, while still giving you an experience without third-party ads and spam.
So if your airline or bank communicates with you via text message, WhatsApp now wants to handle this communication directly.
It is a similar approach to Facebook’s messenger service which offers users the chance to chat with businesses and is currently building new features such as personal assistant “M.”
So while the subscription fee is gone, WhatsApp still needs to make money which means there is some form of monetisation coming the future. However, what form that monetisation plan will take remains to be seen.
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